The members of the Iraqi public in the car ignored warnings to stop and the soldiers opened fire.
It's thought seven women and children were killed, two were hurt, but four other people in the vehicle were not injured.
This is a serious blow to the coalition forces, who are trying to convince the Iraqi people that they are there to save them, and liberate them from Saddam Hussein's leadership, not to harm them.
This comes as heavy bombing continued day and night in Baghdad, the Iraqi capital. The coalition forces are targeting key government and military buildings.
Some ground troops are now just 80 km away from the capital, although they are meeting fierce opposition from Iraqi Republican Guard units.
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